Thai energy policies out of touch with reality: Abhisit

Democrat Party leader Abhisit Vejjajiva yesterday criticised the Prayut Chan-o-cha government's energy policies as out of touch with reality, saying they do not reflect global trends and the regime would lose opportunities to stimulate the economy and raise purchasing power.

"Thailand may be the only country in the world where the taxi fares increase when the oil price drops by half," he said.

There are also discrepancies in the policy to make the public and the industrial sector pay the same price for energy, he said.

"In reality the petrochemical industry pays for gas at lower prices than other sectors. The general public should have been given first priority to get to use gas at its cost. The policy will clearly sabotage people's purchasing power. It will be hard for the government to stimulate the economy," Abhisit said.

Global oil prices have declined and the government should have thought of opportunities that come with this, but it has been aggressively amassing money for the Oil Fund - between Bt3 billion (S$80,700) and Bt4 billion a month - and now the fund has more than Bt10 billion.

He said the public had been calling on the government to reduce the price of diesel to reduce transport costs that add to the cost of every good but it had failed to rationalise this and make diesel and petrol subject to the same tax.

"If the government does not regard diesel as the fuel for the business sector and petrol for personal consumption, it will be hard for the economy to pick up."

Abhisit also criticised the policy to subsidise farmers for agricultural produce such as rice and rubber, saying the policy was not clear and subsidies would not help farmers in the long term.

He said the Prayut administration's policy on rice and rubber was a misunderstanding, as the government did not want to follow the Democrats' price-guarantee policy, thinking it might yield the same disastrous results as the Yingluck Shinawatra government's rice-pledging scheme.

"Our rice-subsidy policy did not affect the market mechanism because we offered to help farmers directly," Abhisit said, though he admitted his party's policy should have improved its registration of farmers who needed help and to evaluated reference prices that reflected the costs of farming.

"The Prayut government has rushed to provide subsidy in per-rai terms, thinking that giving subsidy sooner is better, without knowing the price of rice. This will affect the price because rice buyers will push the price down, since they know farmers received a subsidy from the government," he said.

The government had asked farmers to stop planting off-season crops without having concrete plans how to help those who lose income from such crops.

For rubber, he said the government must come up with a plan - what it will do with rubber in stock so that it won't finally be resold in the market and cause the price to fall.

"The government doesn't have a clear plan and the market knows that this portion of rubber is still left in stock, and the rubber price won't increase easily," he said.

The plunging prices of farm products has greatly affected people's purchasing power and compounded the problem of the faulty energy policy, Abhisit said.

Meanwhile, the former PM urged the government to lift martial law, saying it directly affected tourism because foreigners could not buy travel insurance to visit Thailand, as insurance companies restrict their coverage in countries with martial law.

"Foreign investors will not invest in countries with abnormal circumstances. Hope for exports to stimulate the economy is also dim," he said.